All employers will be affected by the Victorian Government’s plan to legislate the right to work from home two days a week, and Jacinta Allan will confirm there will be no exemptions for small businesses.
It comes as the cabinet met on Monday to give the green light to the plan, a key pillar of Labour’s re-election campaign, with further announcements expected during the week of parliamentary sittings.
On Tuesday, the prime minister planned to confirm that all businesses, regardless of size, would be covered by the laws once passed.
It marks a change from comments Allan made last year indicating the government would consider an exemption for small businesses.
Allan said the government had consulted widely with businesses and decided that applying the policy to all employers was a matter of “fairness”. He said while many large businesses and organizations already offer flexibility, such arrangements were less common in small businesses, which employ about 1.3 million Victorians.
“If you can work from home for a small business, you deserve the same rights as someone who works for a big bank,” Allan said.
Last year, the prime minister announced that her government would legislate the right to work from home two days a week for those who could “reasonably” do so.
He said the legal right would apply to both public and private sector workers. But it is still unclear how it would apply, given that Victoria, like other states, handed over its industrial relations powers to the Commonwealth years ago.
It was a move designed to wedge the state opposition after the issue became a flashpoint in the 2025 federal election campaign, which saw Peter Dutton backtrack on a policy to restrict working from home for public servants due to a backlash.
Business groups roundly criticized the Victorian plan, arguing that employers and employees were best at reaching home-working arrangements. This included the Council of Small Business Organizations of Australia, who at the time said the policy was “yet another example of the Victorian government bulldozing small businesses without proper consultation”.
“Small businesses are the backbone of Victoria’s economy, employing millions of Victorians, yet once again we have been completely sidelined in the development of labor policy that will fundamentally affect the way we operate,” president Matthew Addison said.
The group had urged the government to consider exemptions for companies with fewer than 50 full-time employees due to potential adverse effects.
Allan’s statement said working from home had increased workforce participation, saved families money and reduced congestion.
“It saves time and money and puts more parents to work,” he said.
“Not everyone can work from home, but everyone can benefit.”
Opposition leader Jess Wilson refused to give a position on the policy at a business event last week but said the Liberal Party had a “long history” of “supporting flexible working”.
“I completely understand that working from home is here to stay. So if the prime minister wants to present a proposal, we will study it,” he said.
“But now it is up to the Prime Minister to present that.”
